More than three years after Norton Motorcycles went into administration and 15 months after former boss Stuart Garner was sentenced for illegally investing millions of pounds of pension funds back into the business, parliament’s Work and Pensions Committee has opened an inquiry into the handling of the matter.
Some £9.7 million of savings disappeared from three pension schemes, with the money ploughed into Norton over several years despite laws that make it illegal to invest more than 5% of an occupational pension scheme into assets connected to the employer’s company. Whistleblowers started to raise concerns with the Pensions Regulator as early as 2013, and 227 people lost their savings and have yet to receive any compensation.
Stuart Garner, who was the sole trustee of the pension schemes as well as Norton’s owner and CEO, pleaded guilty to three charges of breaching investment rules in February 2022, and was sentenced to eight months imprisonment, suspended for two years, and banned from being a company director for three years. That means he hasn’t spent any time behind bars. Although he previously ordered to repay the funds, with interest – a total of more than £15 million – after an investigation by the Pension Ombudsman, his own personal bankruptcy was announced in May 2021. So far, pension holders haven’t received any of their money. The Fraud Compensation Fund is going to accept claims, but it will only compensate what was initially invested into the funds, not the interest that was promised to investors.
Although the new parliamentary inquiry isn’t likely to see any new prosecution for Garner, it is intended to help ensure a similar situation can’t arise again.
The inquiry starts today (24 July 2023) with a call for evidence, asking for written submissions with a deadline of 27 October 2023. It’s interested in hearing from members of the Norton pension schemes and intends to hold an event with them to discuss their experiences.
In particular, the Committee hopes to establish whether the Pensions Regulator has enough power to prevent trustees from acting dishonestly and breaching their duties, and whether the right regulations are in place to prevent it from happening again. It will also examine whether different regulations might have resolved the case more quickly and look at the coordination between different bodies and the communication with scheme members to see what improvements can be made in future. Finally, it’s asking if the process of applying to the Fraud Compensation Fund could be improved.
So if you’re one of the 227 investors, make sure your voice is heard.
Throughout all this, it’s important to reinforce that the companies that Garner oversaw, including Norton Motorcycles and Norton Motorcycle Holdings Ltd, are not related to the current iteration of Norton. That’s The Norton Motorcycle Co. Ltd., a company set up by India’s TVS, which snapped up much of Norton’s mortal remains from the Garner-era company’s liquidation in 2020 including the rights to the brand and the intellectual property relating to the bikes themselves.
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